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Basel I and Basel II Compliance: Issues for Banks in India

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  • Sreejata Banerjee

    (Madras School of Economics)

Abstract

Random effects panel data analysis is applied to identify financial parameters that influence banks in India in complying with Basel I. The private sector and foreign banks are affected by credit risk weighted assets; they are guided by the risk in their loan portfolio. The public sector banks are influenced by credit deposit ratio, capital and return on asset. Tobit censored regression model for Basel II shows that business per employee and profit per employee influence CRAR of banks belonging to different ownership in India. In Basel II phase, the net non-performing assets influences foreign banks operating in India.

Suggested Citation

  • Sreejata Banerjee, 2012. "Basel I and Basel II Compliance: Issues for Banks in India," Working Papers 2012-068, Madras School of Economics,Chennai,India.
    • Handle: RePEc:mad:wpaper:2012-068
    as

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    References listed on IDEAS

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    Cited by:

    1. Banerjee, Sreejata & Velamuri, Malathi, 2015. "The conundrum of profitability versus soundness for banks by ownership type: Evidence from the Indian banking sector," Review of Financial Economics, Elsevier, vol. 26(C), pages 12-24.

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    More about this item

    Keywords

    Basel-I; Basel-II; Capital Risk Adjusted Ratio; Non-performing assets; Risk Weighted Assets;
    All these keywords.

    JEL classification:

    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • F33 - International Economics - - International Finance - - - International Monetary Arrangements and Institutions

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